Wednesday, July 15, 2009

Recently, the Financial Times reported that GM is re-focusing its brands, where Buick will be the brand in competition with Lexus, Cadillac will be competing with BMW and Mercedes-Benz, and Chevy will compete with - well everyone else. One of the key ideas is that the brands will become increasingly differentiated, which economically is key for these brands to remain profitable. Given the brands recent past, hopefully the pursuit of brand differentiation will not be diluted again in an effort to gain scale, and as a by-product increase the substitutability between the products and reduce the competitive advantage between the two brands, and also the likely profitability.